Dorothy acquired a 100% interest in two passive activities: activity a in january 2014 and activity b in 2015. through 2017, activity a was profitable, but it produced losses of $200,000 in 2018 and $100,000 in 2019. dorothy has passive activity income from activity b of $20,000 in 2018 and $40,000 in 2019. after offsetting passive activity income, how much of the net losses may she deduct?

Net losses to be deducted after offsetting passive activities = $240000

Explanation:

In 2014 activity A made 100% profit

in 2015 activity B made 100% profit

in 2018 activity A made = $200000 loss

in 2019 activity A made = $100000 loss

total loss from activity A = $300000

Activity B in 2018 made = $20000 profit

Activity B in 2019 made = $40000 profit

total profit from activity B = $60000

To offset passive activity subtract passive profit from activity B  from passive loss of Activity A

= loss from activity A - profit from activity B = $300000 - $60000

= $240000

answerjointly by the fed and by the behavior of individuals who hold money and of banks in which money is held;